Wednesday, October 06, 2010

Survey: 4 in 10 U.S. Workers Planning To Delay Retirement

Towers Watson has released the results of a survey showing that 40% of U.S. workers are planning to retire later than they did two years ago, and a vast majority of workers are prepared to spend less in retirement and are willing to pay more now for greater certainty in their future retirement and health benefits. In particular, older workers and those in poor health comprise the largest percentage of employees planning to delay retirement: 45% of employees in poor health plan to postpone their retirement. In being asked their reasons, 68% of older workers said to keep their health care coverage and 61% blamed the decline in the value of their 401(k) plan.

The survey--"Attitudes Part II: Employee Attitudes Toward Risk"--was conducted with 9,100 employees and found, among other things:
  • more than three-quarters of older workers plan to spend less in retirement than they are spending today;
  • employees are more willing to pay a higher amount for certainty in their retirement and health care benefits compared to 15 months ago;
  • employees across all age groups and plan types are willing to trade higher pay increases for more generous retirement benefits and more predictable health care benefit costs.
According to Towers Watson, the survey found that 63% of respondents are actively paying off their debts to improve their financial situation, 54% are cutting back on their daily spending, and 34% are increasing their monthly savings.
“The economic crisis has had a deep effect on employees’ attitudes toward retirement and especially on risk,” said David Speier, a senior retirement consultant at Towers Watson. “Despite the signs that some employees are saving more, spending less and reducing debt as the economy stabilizes, workers continue to have a fear that they won’t be able to afford retirement — and that will have significant implications on companies’ ability to plan their future workforce needs.”
Source: Towers Watson News Release (October 5, 2010)

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